New analysis of the conveyancing market by Search Acumen revealed the number of active conveyancing firms in the market has now dropped below 4,000 for the first time, as larger conveyancers wipe out their smaller rivals.
The study found that the largest 200 conveyancing firms now account for 39 per cent of cases, while the largest 1,000 firms control more than three quarters.
Andy Sommerville, director of Search Acumen, noted: “As smaller firms that tend to operate on a more local scale are increasingly squeezed out of the market, we risk seeing a consequent fallout of their specialist knowledge.”
Market is putting conveyancers under pressure
David Hollingworth, director of L&C, noted that the lower transaction levels in the market will make life harder for conveyancing firms, with remortgage business lending itself “to those that are best placed to take on high volumes and be highly process driven”.
He added that as margins tighten some smaller firms may elect to concentrate on their core local market rather than try to “gear up” to higher volumes with lower margins, but argued: “That doesn’t mean that there isn’t room for smaller firms.”
Big firms are horrendous
James Mole, managing director of Belgravia London Wealth Management, slammed big conveyancing firms as being “horrendous to deal with”.
He argued that too often their business model relies on employing mostly administrative staff, with conveyancing solicitors overseeing them, which results in each conveyancer having a huge case load. “Getting a response out of them can be difficult”.
Mole suggested the opposite is true of smaller firms, as “they take care with the cases they work on and you end up with a better result”.
What do advisers look for?
Hollingworth argued that brokers are unlikely to focus on the size of a conveyancing firm so much as how confident they are that service levels can be maintained consistently.
He added: “For our part we look to have a range of options open to us in order to ensure that service is less susceptible to the ebb and flow of volume.”
Hollingworth also suggested that technology will play an important role as those firms that can ease the process and improve communication levels with brokers and borrowers alike will gain more traction.
You get what you pay for
Mole noted that clients tend to prefer the “big factory style firms”, because they may offer a cheaper service.
“But I think you get what you pay for,” he added.
